Spirt v Spirt 2024 NY Slip Op 31873(U) May 22, 2024 Supreme Court, New York County
Docket Number: Index No. 160271/2023 Judge: Gerald Lebovits is not a legal malpractice case. It is an argument between brother and sister over an inheritance. Nevertheless, Judge Lebovits averts to the question of disgorgement and legal malpractice.

“In December 2016, Zuckerman opened the IRA at issue, designating plaintiff as its sole
beneficiary upon Zuckerman’s death. Plaintiff alleges that between December 2016 and August 2017, Zuckerman began to show increased “signs of dementia and cognitive decline, and became more and more dependent upon” defendant. (NYSCEF No. 1 at ¶ 9.) On August 17, 2017, defendant took charge of Zuckerman’s financial affairs. (Id. at ¶ 11.) On August 29, 2017, Zuckerman changed the beneficiary of the IRA from plaintiff to defendant. (Id. at ¶ 14.) Zuckerman died in September 2018.

In October 2023, plaintiff brought this action. Plaintiff alleges that the 2017 change of
beneficiary was either a forgery by defendant or the product of fraudulent inducement or undue influence exercised by defendant over Zuckerman. Plaintiff asserts five causes of action. The first three causes of action, sounding in undue influence, fraud, and unjust enrichment, seek damages in the amount of the IRA balance at Zuckerman’s death. The fourth cause of action requests a declaratory judgment that the change of beneficiary is void and that plaintiff is the rightful beneficiary. The fifth cause of action seeks disgorgement of any funds distributed to defendant from the IRA.”

“Finally, defendant argues that plaintiff’s cause of action seeking disgorgement should be dismissed because disgorgement is a remedy, not a freestanding cause of action. This court agrees. In NWM Capital, LLC v Scharfman, for example, the First Department held that a plaintiff’s “allegations of disgorgement do not preclude dismissal” of plaintiff’s claims against defendants against whom claims would not otherwise lie, because “disgorgement in this context is a remedy, not a cause of action.” (144 AD3d 414, 415 [1st Dept 2016]. Similarly, in Marcum LLP v L’Abbate, Balkan, Colavita & Contini, L.L.P. (222 AD3d 486, 488 [1st Dept 2023]), the First Department treated plaintiff’s request for disgorgement of attorney fees it had previously paid to defendants as, “essentially, a claim for monetary damages in connection with [plaintiff’s] legal malpractice claim”; and therefore that dismissal of the malpractice claim also entailed
dismissal of the disgorgement claim.

This court holds only that plaintiff may not maintain a freestanding claim sounding in
disgorgement. This court need not, and does not, reach on this motion the question whether plaintiff may obtain disgorgement as a remedy should he prevail on one or more of his other causes of action.”

Email this postTweet this postLike this postShare this post on LinkedIn
Andrew Lavoott Bluestone

Andrew Lavoott Bluestone has been an attorney for 40 years, with a career that spans criminal prosecution, civil litigation and appellate litigation. Mr. Bluestone became an Assistant District Attorney in Kings County in 1978, entered private practice in 1984 and in 1989 opened…

Andrew Lavoott Bluestone has been an attorney for 40 years, with a career that spans criminal prosecution, civil litigation and appellate litigation. Mr. Bluestone became an Assistant District Attorney in Kings County in 1978, entered private practice in 1984 and in 1989 opened his private law office and took his first legal malpractice case.

Since 1989, Bluestone has become a leader in the New York Plaintiff’s Legal Malpractice bar, handling a wide array of plaintiff’s legal malpractice cases arising from catastrophic personal injury, contracts, patents, commercial litigation, securities, matrimonial and custody issues, medical malpractice, insurance, product liability, real estate, landlord-tenant, foreclosures and has defended attorneys in a limited number of legal malpractice cases.

Bluestone also took an academic role in field, publishing the New York Attorney Malpractice Report from 2002-2004.  He started the “New York Attorney Malpractice Blog” in 2004, where he has published more than 4500 entries.

Mr. Bluestone has written 38 scholarly peer-reviewed articles concerning legal malpractice, many in the Outside Counsel column of the New York Law Journal. He has appeared as an Expert witness in multiple legal malpractice litigations.

Mr. Bluestone is an adjunct professor of law at St. John’s University College of Law, teaching Legal Malpractice.  Mr. Bluestone has argued legal malpractice cases in the Second Circuit, in the New York State Court of Appeals, each of the four New York Appellate Divisions, in all four of  the U.S. District Courts of New York and in Supreme Courts all over the state.  He has also been admitted pro haec vice in the states of Connecticut, New Jersey and Florida and was formally admitted to the US District Court of Connecticut and to its Bankruptcy Court all for legal malpractice matters. He has been retained by U.S. Trustees in legal malpractice cases from Bankruptcy Courts, and has represented municipalities, insurance companies, hedge funds, communications companies and international manufacturing firms. Mr. Bluestone regularly lectures in CLEs on legal malpractice.

Based upon his professional experience Bluestone was named a Diplomate and was Board Certified by the American Board of Professional Liability Attorneys in 2008 in Legal Malpractice. He remains Board Certified.  He was admitted to The Best Lawyers in America from 2012-2019.  He has been featured in Who’s Who in Law since 1993.

In the last years, Mr. Bluestone has been featured for two particularly noteworthy legal malpractice cases.  The first was a settlement of an $11.9 million dollar default legal malpractice case of Yeo v. Kasowitz, Benson, Torres & Friedman which was reported in the NYLJ on August 15, 2016. Most recently, Mr. Bluestone obtained a rare plaintiff’s verdict in a legal malpractice case on behalf of the City of White Plains v. Joseph Maria, reported in the NYLJ on February 14, 2017. It was the sole legal malpractice jury verdict in the State of New York for 2017.

Bluestone has been at the forefront of the development of legal malpractice principles and has contributed case law decisions, writing and lecturing which have been recognized by his peers.  He is regularly mentioned in academic writing, and his past cases are often cited in current legal malpractice decisions. He is recognized for his ample writings on Judiciary Law § 487, a 850 year old statute deriving from England which relates to attorney deceit.